show. jordan sparks, thank you very much for joining us live today. >> thank you very much. >> congratulations. >> see you tomorrow. bill: all right, good morning, everybody. where has time gone, huh? the health care law, signed into law, six months ago today, joe biden said it was a big bleeping deal and provisions set to take place in 24 hours that will affect millions of americans. are you one of them? is your family part of this? big bleeping deal, huh? >> martha: it was a big bleeping deal! bill: i'm bill hemmer. martha: good morning, bill, good morning, everybody, i'm martha maccallum. president obama will discuss the so-called patient bills of rights. this is the way it's framed today. he's going to talk to people who say they've benefitted from the health care overhaul. the president said democrats should be proud on this, when they go out campaigning in terms of the new law, but with just weeks to go before the midterm the only democrats that seem to be

talking about it on the campaign trail are the ones who voted against it. bill: this may be why, new polling numbers show that law was a hard pill to swallow for many americans, only 30 percent of likely voters say they support it. chief political correspondent for the washington examiner, bay iron -- byron york, good morning to you. in politics and how this applies to health care, medically speaking, first to politics that, 30 percent figure is why democrats are not running under a yes vote in this election. >> the politics have always been bad, for the whole six months for democrats. if you average all the polls together, you see about a 15-point gap between people who disapprove, don't support the program and people who do. give you one example, representative john dingell, you know, long-time member of the house, democrat, very closely associated, has fought for health care for every one of his 55 years in the house, running a new campaign for his reelection in michigan, it mentions how he was tough on bp, how he's

tough on tainted foods, does not say a word about national health care. this is very characteristic of what's going on with democrats around the country, people who voted for the bill are not really touting it in their campaign. bill: that's just one example. dingell is in a tough fight, too, there in michigan, jobs have a big effect in that state, too. now as it applies, this is what will go into effect within the next day, on the screen now, banned denying coverage to kids with preexisting conditions, ban on insurance companies dropping coverage, prevent tiff care covered at no extra cost. what is wrong with any of that? >> well, this is what democrats counted on, changing the public attitude about the health care reform. they thought that by now, people would appreciate that more. so far, that hasn't happened. but if you talk to republicans, who want to get rid of this health care law, even they say they are -- they want to keep things like the preexisting conditions ban, the ban on lifetime caps, but right now, since the health care

reform law is being instituted piecemeal, the biggest parts go-go into effect until 2014, when you're seeing is some effects that are not so good, which is if the government forces insurers to offer more extensive polices, then prices are going up. so you're seeing actual premiums going up, instead of down, as the government -- >> bill: but your point is well taken. there was a lot of agreement on some of those provisions that would take place in the next 24 hours. there's one thing we'll get to a bit later and that's the insurance companies, a story out of california, that are already dropping child coverage from their care, or their coverage, because they're afraid of the costs in the long run. we'll get to that a bit later this morning. byron york, thanks, leading our coverage on health care reform in washington. martha: all right, to politics now. she says she is done with national media, at least for now, delaware senate candidate christine o'donnell told fox news' sean hannity she wants to focus now on the voters in

delaware exclusively. she's now set to face democrat crist coons in november, she's behind by about 15 points, depending upon where you look. she says it is already getting ugly. >> watch this. watch how this campaign unfolds. they started their ads this week, and they're attacking me personally. they're not attacking where i stand on stimulus, they're not attacking where i stand on extending, if not making permanent, the bush tax cuts, they're not attacking me because i want to permanently eliminate the death tax, or propose a two-year temporarily tax holiday on the capital gains tax in order to get the economy back on track, they're not attacking me on my positions. they're trying to attack me, which is why i'm getting out there, to the people of delaware, why i canceled the sunday shows when churches invited me to attend their services and people in delaware invited me to go to their picnic -- picnic, because this race is about what's important to the people of delaware and what's important to the people of delaware are how we're going to get jobs

back, how we're going to reduce the size of government, and they're worried about the tax hikes. >> all the talk about you got to do this national show, that national show. >> no. it's off the table. because that's not going to help me get votes. i instead want to go to as many town hall forums, candidate for uls, as many church picnics that i can fit into my schedule to meet the voters. >> you're saying no to the national media. >> i'm not going to do any more national media because delaware is my focus and the local media is my focus. martha: that's perfectly clear, based on all of that. in the meantime, she says she's holding on hope her former opponent mike castle will come around, that he'll endorse her in the general election, the race against coons, which could be very helpful. he's still when you poll him theoretically, he's polling better than she is, so that -- >> bill: that is must-see tv in the states. something we'll watch here. brand new polling number, out of gallup, when asked who represents your attitude about the role of

government today, 52 percent say republicans, 44 percent say democrats. that's a stunning downturn for democrats, taking control of congress in 2006. republicans, for that matter, have not seen these numbers since 1994, 60 years ago, and we all remember what happened in that midterm election. martha. martha: republicans are now less than a day away from unveiling some of the changes coming to washington. we've got new details on their, quote, contract with america, which is essentially a blueprint of how they would run the government if they went to november. here's some of the things the party plans to do. they've been the party of no -- been called the party of no and now they're coming back with this agenda, dial back or repeal health care. that's a big part of this agenda. it will also introduce arguments about improving terror-related detainees on u.s. soil, a hot topic over the last year, we're going to have more on the gop agenda, how they expect to run in these races and what

they would do if they'd run the majority. al that's coming up. bill every hot political development coming in the midters, at your fingertips, wherever you are, download the america led quarters iphone app, fox news.com or pick it up at the app store. i downloaded it. martha: i you did. you're so cool. we have a fox news alert. there's a big shakeup of the white house's economic team going on, just announced, economic chairman larry summers is going to step down at the end of this year. there were hints this would happen within the recent days and weeks. the announcement comes on the heels of two other economic leader departure, peter orszag, he left several months ago, cristina romer also left office, now all eyes are on the remaining person on that team who you see at the far end of your screen there, treasury secretary tim geithner, but could there be something more at play here? let's put that question to our own stuart varney of the fox business network, he's

here to break it down. the president, when asked about his economic team the other day, stuart, he started hinting people make changes in their lives, they put in a lot of hard work and lo and behold, less than 24 hours later, larry summers says he's leaving. >> three of the four architects of the president's economic policy are now gone, that may be a tacit admission of failure of that policy. but look, there are three questions here: number one, who's next. who is going to replace larry summers. we're told the administration wants an executive from private enterprise, preferably a woman, to replace larry summers, but absolutely not another academic. second question, what's next in terms of policy. will the president stick with taxing the rich and spending government money to create jobs? that's the next question. what's next. number three, is this maybe the start of an exodus from the white house in other policy areas. you have to say that ken

salazar, interior secretary, under some fire because of the handling of the oil spill, same with steven chu with energy, under fire with the handling of the energy department. so there's three questions: who's next, what's next, and is it the start of a general exodus. martha: it's very interesting questions you bring up, stuart. and the president has also talked just in the past couple of days about people being not so much in favor of big government. now, there have been a number of indications all the way through his presidency that he wanted to expand the reach of government in many ways. it raises a question, will -- will he do that, if he does have to pick a new treasury secretary, and i find it fascinating that you're saying now you hear from the white house that they want it to be someone from corporate america, someone with business experience. when -- as a woman, i would rather somebody be picked on their experience and ability to do the job than just be a woman. >> well, look, the president does not have anybody in his cabinet who has direct experience of business. nobody there.

and so if you put somebody in as a senior economic adviser from business, that would maybe placate business to some degree because the president is being antibusiness or perceived to be antibusiness right from the get go. as to your suggestion about whether it should be a woman or not, this is a very political white house, it's a politicized position. i guess it would look good to some politically if you replaced larry summer, a man, with a woman. and remember, larry summers dropped his job as president of harvard because he tangled over the woman's issue. martha: that's true. that's a good point. >> to replace him with a woman would be politically expedient, i guess you could put it like that. martha: i questions you -- i guess you could. i hope they pick the best person for the job in the end. thank you, stuart. bill: guess what the next issue is for democratic senators? one hint. it is not jobs. martha: what? >> bill: we'll debate that in a moment and the news on that. martha: the bush-era tax

cuts, another huge issue right now. this one is so hot, folks, coming up, we're going to take a closer look at what will happen if those bush tax cuts do actually expire, how much more money starting january 1st. you -- you will have to dish out to uncle sam. bill: corruption on steroids, new details in the stunning arrest of the city leaders in the tiny town of bell, california. >> these charges are the first wave of a continuing criminal investigation involving the city of bell. and the investigation such as this is very much like peeling away layers of an ion. each time a piece is pulled away, another piece is uncovered. bill: this is breaking news, and this morning we expect to see a parade of politicians go before the judge, and you will see it here on "america's newsroom". and guess who's celebrating? back in a moment.

bill: remember that promise of jobs, jobs, jobs? well, we're learning today that next on the senate democratic agenda is campaign finance reform. and we said what? and kirsten powers said i'm going to come and talk about that, fox columnist, and brad blakeman said i'll jump on that, too. former deputy to president bush, how you doing, both of you? kirsten, help me understand this. the economy is important, why are we doing campaign finance? >> i don't think the whole government comes to a screeching halt and isn't capable of doing anything else because the economy isn't going well. i think there are issues out there that need to be dealt with in terms of dealing with campaign finance. they're basically trying to have companies, special interest groups, who are funding campaigns or, you know, funding any kind of election activities to have to disclose that information. bill: which may be very

important, but you're 40 days from a midterm election here. >> this is absolute tone deafness. look, bill, if this bill had any effect on this election cycle, put the bill forward. the fact is this bill has no effect, zero effect, on a major election that's coming up where people are unemployed, they're fearful about their futures, their children's futures, and what do the democrats do? they don't hear what the people want and they're concerned. you know what bill clinton said this week? he said the democrats should focus like a laser beam on the economy. he also said there's over a trillion dollars out there where people are just sitting on their money, fearful of what's going to happen in january when the bush tax cuts expire. there's no confidence. bill: harry reid is senate majority leader, he's in a tough battle, kirsten, in nevada. the unemployment rate in nevada is 14.4%. i think that rivals michigan across the country for a number that high. he's in the race with sharron angle, a virtual unknown before two months

ago and it's neck and neck. his approval ratings among likely vote e.54 percent disapprove of what he's doing back home. and all that's tied to the economy. so help make sense of that. >> because i don't think them bringing up one bill to deal with campaign finance reform, which is an important issue, means that they're not focused on the economy. i really think that, you know, with all due respect, to brad, it's playing politics here and jumping on them and pretend thank they don't care about the economy. if you want them to bring up tax cuts, i agree with that, i think that they should force that issue and they should force the issue and show, you know that, actually -- actually, i've heard karl rove was complaining in his column the other day about how expensive the middle class tax cuts are going to be, but weil, you know -- phao*el, no complaint basketball how expensive they're going to be to give them to the very rich people. so let's see who's actually really interested in helping the average american. force the issue on taxes. i hope they do that. bill: this has gone back and

forth. i don't know what's going to happen with tax cuts but we could see something on the house side real soon. what about kirsten's point about tax cuts and whether or not harry reid can win this election in nevada? >> well, look, harry reid, he's not only trouble in his own state, he's in trouble as a leader throughout america, the american people do not see the democrats as putting this country on the right track. as a matter of fact, 77 percent of americans polled, not republicans, independents, democrats, all people, say that the country is on the wrong track. but here's the bottom line. they control congress. the house and senate. they control the agenda. i agree with kirsten, let's put it on the table. let's put it on the table now. let's not put finance reform on the table. let's put tax cuts on the table. let's have a -- moratorium on payroll taxes, cap tap gains, death tax, and let's get this country on the right track. bill: to that point, kirsten, you can control the message, too. >> but you know, brad doesn't want them bringing up the disclosed act, because he wants corporations and special interest groups to -- >> no, i want them to bring

it up. i want them to bring it up at the right time. >> do you support it? why are republicans blocking this from coming to the floor? republicans do not want companies and special interests to have to disclose the money they're getting. >> we do. >> why are they blocking the bill? >> you guys are carving out unions and special interest groups. you guys have to play by the same rules as everybody else. >> i agree that i think the nra and unions should be held to the same thing but don't they adjust to democratic special interest groups. nra -- >> bill: ultimately the odds you're playing to are likely voters who will or will not vote in 42 days from now. kirsten, thank you. brad, we'll continue this discussion. >> thank you bill. bill: also we'll continue it on line. today, at our website, foxnews.com/"america's newsroom", you can take our poll today, and answer the following question: are you more likely or less likely to vote now than you would in 2008? that's our polling question

on line, check it out right now, 20 minutes past the hour. martha: that's a good question. wonder what it might be like in the west wing today? they gave open access to the man who brought us watergate so are d.c. insiders happy with what the book says about the bickering and infighting over the handling of the war in afghanistan? we'll take you inside the book that has everybody talking today.

bill: there was a proposal to give legal stattous illegal immigrants that came to this country younger than the age of 16 who would commit to at least spending two years in college or the u.s. military, that proposal died in the senate yesterday dualing demonstrations for and against the bill, playing out across the country, this one, from phoenix, arizona. the dream act as it's known

had supporters rallying outside of john mccain's office. he had supported the measure about two years ago and yesterday he voted against it. >> we have a passion, we are american, we have a passion for this country, and that's what we want people to know. >> we need the jobs for our own, we have our children going to school and coming out with degrees and no job to go to and these people want to have the same opportunity to get in that job market and take from our children. bill: to be clear, the deal act was part of a defense spending bill and senator mccain said it should not have been attached to that measure. democrats now -- failed to get a single republican vote on that proposal. >> martha: how cute that.

mcdonald's, loving his makeover there and people seem to be feeling the same about the fast-food chain these days, while so many businesses have been struggling, the big macs are biging in big bucks, the company seeing huge growth. as part of the road to recovery series, mike tobin is checking it out in chicago, having a few big macs today. what's the secret there? >> reporter: the secret is the secret sauce. i'm just kidding. secret is evolution. take a look at this, over the counter, this is the mcdonald's that you would recognize. as we take a tour around here, gone are the old fiberglass that you remember, we have a warm fireplace hearth, leather seating, pumping wi-fi into this place, all competing with starbucks dollars. they have healthy options, you've got, over here, talking about competing with the starbucks dollar, all the cafes where they have lattes and frappes, whatever, you can even get

smoothies, and if you're in a hurry, you've got the option, combine that all with the fact that they're open from 18-24 hours a day and they've got that massive marketing sledgehammer that made ronald mcdonald as recognizable as santa clause. the coo out here says that is the code to keep the customers coming. martha: that looks amazing. it looks like starbucks! so is it working? when it comes to the bottom line, are they making money with this plan? >> you know, mcdonald's has never really had bad numbers they've had slowdowns from time to time, but if you look at the stock right now, they're up to about $75 a share, up from $32 a share, about five years ago. their operating income is up about 90 percent from the same period of time, and they're serving about 27 million people every day. martha: i'll take a frappe and fry, mike. one of those frappe, whatever things you talked about, and some french fries. thank you, mike tobin. it's the fancyiest

mcdonald's i ever saw. bill: a big bleeping deal, too, if you think about it! americans, listen up, our students are falling way behind in a new documentary that's getting a lot of attention. says it may take a superhero to save them. >> these are the kids that are getting stupider every year, or something is wrong in the education system. >> children of future generations are on the bridge of the titanic and everybody is going to drown. bill: waiting for superman takes on the teachers' unions in a new documentary and they are fighting back. plus this: >> martha: all right, remember these face, remember these workers in bell, california, who were cashing in ridiculous salaries forcy workers? today, they are in front of a judge, folks, and this is going to be interesting. folks say it is about time. >> you know what? he doesn't have no feeling. he knew what he was doing. he had to pay a price. he needs to be locked up for life. >> the people here are angry. they're very angry. they're not mad, they're

angry. and i think they're all very disappointed. >> they're going to get what's coming to them, for digging do deep -- too deep in the cookie jar. martha: wondering as i am if this is going on in other places across the country? a live report, coming up next.

bill: 93 150eu78 1250eu78 -- 9:31 here in new york, a platoon of politicians out of bell, california, set to be arraigned in an l.a. courtroom in a matter of

moments, accused of sing tax dollars for their own personal piggy bank, a prosecutor saying they broke the law to afford themselves outrageous salaries and personal loans and now they will face the judge. bell city officials made out big for a while but only for a while. top of that list, city manager, close to $800,000 a year, and that figure is just the start of it. assistant city manager, almost $400,000. the police chief, almost $500,000 per year. this is a town of about, i don't know, 25,000 people. william la jeunesse, outside l.a. superior court, how did this happen, william? >> reporter: well, bill, they are being charged with stealing about 5 million in tax money from this small community in l.a. county, where one in six people live in poverty. they'll be arraigned on up to 50 counts of misappropriating public funds, as well as conflict of interest. now, the ring leader in all of this is the city manager, robert rizzo, he was arrested yesterday outside his luxury home in huntington beach as he tried

to pull away in his cadillac. let me show you how this scam worked. now, under a standard procedure, a city manager's salary would be discussed in an open meeting, his contract would be reviewed by the the city attorney, and it would be approved by the city council in an open meeting. instead, let's go to the next full screen, rizzo produced a counterfeit compensation contract. he used fraudulent signatures, and to illegally inflate his salary and benefit package. so the the city attorney was com polit with this, as well as the city council, which was being paid for a job it didn't do. as we look at the city council, according to the district attorney in l.a., they were billing the city for meetings that never happened, and some meetings that lasted only two minutes. the d.a. said they had 70 minutes of meetings over the entire year to bring down a salary of about $100,000 each. bill, that is why they call it stealing.

bill: wow. phantom meetings. i mentioned that town is 25,000. it's actually 40,000, about 50 miles south of l.a. will they northbound jail for a time, will they meet bail? what will happen, william? >> very good question. number one, they are facing, at least rizzo, decades in jail. here's the rub in this whole thing. they're going to appear in this arraignment, they'll plead not guilty and the judge will hear bail. in los angeles county if you're charged with bilking $3 million, then your bail is set at $3 million. however, there's a clause here that says that your bail money that's posted for bond cannot come from ill gotten or felonious activities. therefore, if you're going to put up your collateral to your house as a compensation or as collateral for the bond, the d.a. is going to do an investigation to determine if that house was purchased with money stolen from bell, and if so, he won't be able to use it to

post bond. so it's possible they could be in jail for a long time. bill: we will watch and wait for the appearance before the judge. and next hour, lieutenant governor -- >> 8:30. >> 8:30, okay, the lieutenant governor next hour is our guest on this same topic, so stay tuned for that. martha: stop what you're doing and listen to this, okay, because this is a new documentary that takes a really important look at what is going on in america's school system. it focuses on a number of things, including the impact of teachers unions on our school system, the movie is called "waiting for superman" and comes from the same director as al gore's "inconvenient truth", it the lives of five children in america, all of them have families behind them, they are just hoping they can get a shot at a good education. >> i'm one of those -- >> for these kids, their only chance of getting into a great school depends on

whether their number is picked in a lottery. >> 18. >> ♪ >> ten. >> ♪ >> 12. >> ♪ >> two. >> ♪ >> and the last number? >> ♪ martha: let me tell you something, i've only seen the trailer of this and h-s heart broke and it -- heat break and it chokes me up, those kids are hoping they're the number that will be killed so they don't be one of the kids that don't get into school in their neighborhood. unfortunately 2 percent get to go to the charter schools paid for with public funding. tucker karlson is editor of the daily caller and fox news editor and has done a lot of work in education in this country and studying what's going on, he has children as i do, and so many of you do out there and i know he cares about this a lot. this looks to be based on what i've seen so far a really important message that a lot of people need to

hear, tucker. >> i think this is a pivotal moment. this is not a film made by conservatives, guggenheim made "inconvenient truth" with al gore and yet it goes after the teachers union, randy weingarten in particular. i think this is moment that americans wake up to the fact that teachers union are the single greatest impediment to school uniform martha: david guggenheim said that he resisted, he said i'm a lefty, you know, a self-proclaimed lefty liberal, accepted i resisted calling out the teachers unions in this movie but everywhere i went it just kept coming up, it was right in my face, there was no getting around it, it was one of the major problems that we're having out there. let's look at some of the these numbers and want to get your reaction to it. these are some of the statistics in this movie, the u.s. ranks worldwide 25th in math. i think we are 21st in science, the next number that's going to come up. this is the real shocker to

me and this is really what breaks my heart, we're number one in confidence, our students, tucker. so we've given them tons of self-esteem. >> that's right. martha: in many cases, not a whole lot of skills. >> that's exactly right. in some cases there seems to be an inverse relationship between self esteem and achievement, the better you feel about yourself, the more poorly you do. we spend a lot of time on self esteem because it's easier than teaching the civil war, for instance. there are two imped mens going on. liberals are catching on to the fact that teachers unions are an impediment to progress and if you're serious about schools you're not going to be putting teachers unions first, however, there's a massive contributor to a democratic party which is one of the reasons you don't see president obama moving forward on reigning in their power, and two, in a lot of communities, communities with bad schools, schools are seen as a jobs program, and so efforts to pull back the teachers unions, to fire incompetent teachers are often met with real resistance in cities like washington, d.c. because the schools hire a lot of people

who wouldn't have jobs otherwise. martha: what happened in washington, d.c. >> the mayor here, just lost last tuesday the democratic primary, he's not going to be mayor next year, mostly because he supported michelle reid, the school chancellor who fired over 200 teachers in washington. president obama did not come to his aid, help him, stand up and be counted in this legs and basically he was turned out of office because people in washington, d.c., where i live, were offended that the schools were no longer employing as many people. again, schools are seen as a jobs program. it's a complicated, complicated issue. martha: we don't have time to look at it but this morning there was a teacher on fox & friends who represented 700 teach respect in brooklyn, i believe, who decided they don't want tenured, they want their salary to be based on how well they do, and i was at my son's middle school, public school, back to school night last night and i got to tell you, i was so impressed with the teach theirs spoke there last night and i thought to myself, you know, teachers, nobody -- and this isn't about beating up on tiv e. nobody wants the good teachers in this country to

not be paid well, so why do you think teach respect are so afraid of backing off tenure like the teachers in brooklyn and saying pay me based on my job. >> not all are. i married a teacher and a lot of teachers believe that excellence ought to be rewarded and crummy behavior, punished. but in the end, job security is what the unions are after. not the best possible environment for the kids. the unions exist to protect jobs for teachers, whether those teachers are competent or no. that's what unions do. that's their mission. but it's not the same as educating kids. martha: yesterday, why not just judge teachers the way the rest of us are judged by our employ respect -- by our employers. tucker karl kohn, i appreciate you being this and i know you care a lot about it. bill: you liked the movie, huh? >> martha: what we've seen of it so far. he'd love to listen to the whole thing. we have the clips and trailers which looks promising. i'm anxious to see the whole thing. bill: a checko f wall street

now, we doing? must be getting fired. -- must be tired. martha: don't wear out, bulls, keep going! >> bill: up almost 30 points. eleven minutes into the trading day there on wall street. we are minutes away from finding out whether or not our country is considered safer now than before 9/11. a new report is out at the top of the hour. don't miss this. and we will learn in this report what the new threat is today. martha: know what today is? today is six months sin the health care overhaul became law, and you may start to itly feel some of these changes in the next 24 hours, when you go to the doctor. we're going to tell you what to expect, what is different now. you don't want to miss this. what do you folks think, do you thank health care reform could be repealed as some in congress want to do? could that happen? go to our web page, fox news.com, send in a twitter or e-mail. we look forward to hearing

from you. be right back.

bill: there is a new poll showing some americans, and president obama may not be on the same page when it comes to the plan to end the bush tax cuts for everybody, including the rich, and what the white house calls rich. familying makes more than $250,000 a year. an overwhelming number of registered voters, 68 percent, think lowering taxes will create jobs, and after all, letting all the tax breaks expire would raise taxes for everyone, and if congress does not act to stop it, according to one of the big four accounting firms, for a family making $50,000 a year, the tax bill jumps 2900 bucks, for a family making $100,000 a year, $4500 more will go to the irs. fox business network's anchor of countdown to the

closing bell joins me. how you doing? you look at economics, not necessarily politics, but the two are so connected here. >> absolutely. bill: in all likelihood, the psychology tells you what about what will happen with the tax cuts? >> look, if you kept them in place for everybody, that's a psychological win-win. psychologically, people would say oh good, i don't have to worry about paying more taxes. so that could be sort of a shock and awe, kind of like suspending the payroll tax, giving that kind of holiday. these kinds of moves certainly in the mindset of the actual taxpayer or the business owner work very, very well. the question is do they actually work to create jobs, and that is one of the promoting ideas that the republicans are saying that's why we need to keep them in place for everybody. important to focus on the fact that president obama has always said he want to keep them in place for the middle and lower class, keep those tax cuts in place, it's that upper tier he calls $250,000. bill: you mentioned him, let's listen, two days ago, about giving a tax break to the richest 2 percent of

americans here, then i want to ask you a question about it. watch this: >> i can't give tax cuts to the top 2 percent of americans. 86 percent of that money going to people making a million dollars or more, and lower the decifit at the same time. i don't have the math. bill: lower the decifit at the same time. also, the poll, when asked whether or not reducing the budget decifit will create jobs, 60 percent agree with that. now, go back to his comment here. do middle class tax cuts create jobs. only middle class tax cuts. >> only middle class tax cuts. what we have seen in the past is that tax cuts certainly help with keeping money in taxpayers' pockets, they in turn hopefully spend it, in some cases, they do, others, they don't. that means the economy continues, more demand for certain products, businesses do better, they need to hire more people. however, if you look at tax creation since those tax

cuts that everybody is fighting about were in place in 2003, the bush tax cuts, the job creation for actually the whole eight years of president bush was about 3 million, 3 million in the private sector. let's go back to ronald reagan. ronald reagan also implemented tax cuts, but he also raised certain taxes on things like capital gains. ronald reagan's term created about 16 million jobs. president clinton, who raised some taxes, 23 million jobs. bill: and those who will argue will you do the tax cuts for the wealthy, you're going to generate revenue for the government. so that goes right to the argument about deficits. if you do the tax cuts, you stimulate the economy, you do a little spending cuts along the way, too, that's revenue neoo revenue to washington. >> absolutely. >> that makes up for this decifit. >> some of it. bill: do you see it the same way? >> some of t i would love to say it that -- see it that way, except the money that comes in gets turned around and spent once again by congress. we need to cut spending as well. it's not that your five

fingers and only this one is a tax cut and that matters. all these have to work together to create the whole hand. about bill if you put all three together, do you think that given what we're facing in this country that we could turn this around? >> i absolutely believe we can turn this around. however, at the moment, you talk to people on both sides of the aisle, bill, they say leave the tax cuts in place for everybody, even for just a year. problem is you know in a year, everybody will start arguing again. at some point, they have to sunset for some parts of the population if we're going to cut down the spending. bill: liz, thank you. check out liz every day, week days at 3:00 eastern, countdown to the closing bell. thank you liz. here's martha. martha: good luck, liz. thank you for being here. an exclusive inside seat to the president and his war council. washington insider bob woodward's account is just coming out today of the president's deliberations with regard to the war in afghanistan, the divisions

among his advisers, the exit strategy that he wants to see implemented, and a bombshell revelation about afghan president hal id karzai. bill: on a different note, paris will always have paris, won't she, martha? why is japan saying the partying sell seb not welcome in this country?

bill: paris, all right, tokyo, forget about it, paris hilton is coming back to the u.s. after japan apparently sent her home, denied entry into the country after a drug charge in las vegas. hilton was supposed to

promote the fashion and fragrance lines at a news conference in tokyo, but all smiles and baseball hats, and sunday glasses, she told reporters she hopes to return to japan. i look forward to coming back in the future and i love everyone. i'm really tired. >> where are you headed? >> bill: here's the deal. japanese law says authorities can deny entry to those who have been convicted of drug-related offenses. in this case, that applies. before leaving tokyo, she tweeted the following about the takeoff, going home now, so disappointed to miss my fans in asia. i promise to come back soon, i love you all. martha: feel so sorry for her fans in asia. back here in new york city, president obama taking the world stage at the united nations today, but a lot of folks are focused on iranian president ahmadinejad and his latest threat. eric shawn joins us live from the united nations

there. what is expected to happen today? >> reporter: martha, president obama will address the u.n. summit on global poverty this afternoon but as you said, all eyes have been on mahmoud ahmadinejad's firey rhetoric, the iranian president yesterday saying if israel or the u.s. attacks its nuclear programs, that would unleash, quote, a war that would know no boundaries. this afternoon the security council members will be discussing iran policy, and we sat down with one official, ahoud barack, official of israel, who said there is time in his view for sanctions and he believes they are effective but he also acknowledged they have a limit. >> i believe that it's time for sanctions, but it will end in a relatively short tile and we have to start and think of what would come later. we, israel, believe that no options should be removed from the table. >> when you say no options

does israel have the will to attack the iranian nuclear facility? >> i don't think that that's an issue to talk about in front of the tv. but israel is a sovereign state, it is to me -- iran to me is responsible for its future and we will do whatever circumstances are right under the circumstance >> reporter: well, iran is violating four security council resolutions and ahmadinejad will have another chance to address the united nations. he will speak before the general assembly on thursday. president obama will also do that same thing in the morning. back to you in the studio. martha: we'll be watching all that on the east side of manhattan. eric shawn, thank you very much. bill: what's the republican plan if they take over congress in seven weeks? new details on their ideas that will be public soon. you'll see it, top of the hour here. [ female announcer ] you choose the cutest outfits.

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martha: you know what they have been called, the party of "no". and, now they are letting america know what they would do, if they are to get a majority in the house, and possibly the house and senate and will reveal their plans and -- republicans are, tomorrow and we're getting ahead of this, and have some of the specifics on what they are saying they'd do, that is how we start a brand new hour of "america's newsroom," glad to have you with us, i'm martha maccallum. bill: i'm bill hemmer. good morning to you, we have been waiting on this, the blueprint on health care, scale back or repeal the overly haul of health care, on national security, prevent any terror suspect from being held in prison higher on american soil, that is just part of it. martha: yep, big business, and hot topics and shannon bream joins us live on capitol hill, what is on tap. >> reporter: it is contrast to 1 1994 with the unveiling of america, done on the steps of the u.s. capitol and there was a lot of fan fare and first, here they'll have a roundtable at a

lumber company, outside of washington here in virginia and they'll have small business owners who sit at the table, the man who owns the lumber yeard, his wife, an attorney and, a salesman and, someone in software development, and here's points we know they'll hit on in the so-called governing document, they'll roll out, job creation, at this top of everybody is a list and republicans will outline what they propose to make it happen and also something they have been fighting for, extending the bush tax cuts, for everyone, across the board, all income levels and, also, something we hear they may include, a 72-hour mandatory reading period, for bills that are put together, have to get posted and members have to have a chance to read them before they get to the floor for a vote, 20 items in all, we'll have details tomorrow morning. martha. martha: three days may not be wrong enough to read the bills we have seen coming through the past year, so, democrats haven't really seen this yet but how -- are they responding to what they have heard so far. >> reporter: we're hearing from a number of tom democrats in the

house, including steny hoyer who says, listen, we don't expect anything different and you mentioned they are called the party of "no" and it will be more of the same and they'll try and put a new face on old policies and he says it will be '08 all over again, the american people will see through it and reject it, of course democrats hope that is what happens, because they are in a bind, a lot of them, and the -- in the run-up to the midterms, they say it will help to figure out how to better run against the republicans, a few weeks ago, until november 2nd. martha: indeed and a lot of folks are paying close attention to what is going on, as we head into the midterms, and they'll be listening, shannon bream as always, thank you very much, shannon. >> reporter: sure. bill: hot off the press now, fox news alert, the white house reacting to a bombshell. a new book depicting deep divisions in the administration, over war strategy, jennifer griffin is live in washington on this, bob woodward wrote the book, what are the most explosive revelations, now, public, jennifer? >> reporter: you have heard the president talk about his desire

for a team of rivals, but, this takes rivalry and in fighting to a new level and there's an under lying impression, bill, that the president thinks the pentagon and his generals are trying to get him to expand the war in afghanistan. allah vietn via vietnam and, robert gates, in 2010, we will not have a conversation about how to do more, we will not want to hear we're doing fine, mr. president, but, we would be better if we do more, the book says and we will not have a conversation about how to change the mission, unless we are talking about how to draw down faster than anticipated in 2011. and, the president according to woodward gets frustrated when he keeps getting presented plans to expand the war when all he is looking for, in his own words, is an exit strategy, bill. bill: jennifer, it is clear in the book, based on the excerpts, it is clear, i should say, that this is a political decision as

much as anything else. >> reporter: absolutely. in fact the timing of the book and the book's publishing appears time to sway the midterm elections showing the democratic base he roll opposed the war in afghanistan though he agreed to send 30,000 more troops, now, this is what he said according to bob woodward, when he was -- when the request for 40,000 troops came in. he said, i'm not doing ten years, he told secretary of defense gates and secretary of state hillary rodham clinton at a meeting on october 26th, 2009, i'm not doing long termination-building, i'm not spending a trillion dollars. i have two years with the public on this and i want an exit strategy and i cannot lose the whole democratic party. bill? bill: jennifer, these are quotes now from the president's national security team about afghan president hamid karzai. how did they view him. do they think he's capable? and, more? >> reporter: well, in fact the u.s. ambassador to afghanistan,

karl ikenberry accuses the afghan president of being manic depressive and woodward quotes him as saying, in fact, quoted, he's on his meds, off his meds and, dismissive of president karzai and that is nothing compared to what national security advisor jim jones says about members of obama's political team, referring to them as, quote, the water bugs, the poe lit bureau and mafia and dismissively as the campaign set, bill. bill: always has been a must-read book for politics in washington. thank you, the whole town is talking about it today, in moments fox news security analyst k. t. mcfcfarland is he, what does it mean for men and women overseas and, national securities and all that, to come, here in a few moments. martha: and looking forward to that. new video in fox, an explosion killed ten people and injured dozens more in a military parade in iran and comes as iran's president is in the u.s., in new york, for meeting at the u.n.

and iran's state media reports many of the victims were women and children. in this bombing. these same reports also say a timer detonated a bomb placed near the parade route. one iranian official blamed the attack on kurdish separatists. bill: 6 minutes past the hour, senate republicans blocking a votes on repealing don't ask, don't tell and defeating a defense bill that would have overturned clinton's policy on gays serving in the mill turkitd john mccain reacting, on reports they are investigating soldiers' sexual preferences. senator john mccain. >> that is the fact. that is the fact, i mean -- i know the military very well. and i know what is being done and what is being done is, they are not seeking out people who are gay. i don't care what you say. i know it is a fact. i don't care what you say. and i don't care what others say. i have seen it in action, i have

seen it in action. i know the military very well. so, they are not telling you the truth. martha: reaction, from senator john mccain on that, and in the meantime, right now, a major push in one state, to keep inmates who use smuggled cell phones, from conducting criminal activity behind prison walls, governor mark sanford backs the legalization of technology to jam communication signals inside the penitentiary and the fight intensified after an inmate used a cell phone to coordinate a hit that left a police captain fighting for his life. jonathan serrie joins us live from columbia, south carolina. just how widespread are these illegal cell phones in prison, jonathan? >> reporter: hi, martha, the problem is widespread enough that south carolina officials including governor mark sanford who is now arriving scheduled a news conference and they will be urging, once again, urging the federal government to relax

jamming restrictions so they can better control cell phone use in prison. just how widespread is that use? take a look at these 600 phones over here that were confiscate from south carolina state prisons. just over recent months, in some cases, smuggled inside by visitors, in many cases people using creative means to get them in, look at the football here, it was cut open and stuffed with cell phones and a person hurled the football over the barbed wire fence to get them onto prison grounds and then, over here, you have a potato launcher, that someone actually used to fire cell phones onto prison property. from very long distances and as you can see, people are using very creative means to smuggle these phones into state preference, martha. martha: boy, that is incredible. there are even cell phones that can make it into those preference, and you are showing us how creative they are going about doing this and, you know, you needed a dime for the pay phone in the old days. >> reporter: that's right. and, the difference between the pay phone and the cell phones is

that the old pay phone was very easy to monitor. not so much for the cell phones, which corrections officials say inmates are using for all sorts of criminal activity including harassing witnesses and even calling for hits on law enforcement. in fact, we met a captain robert johnson, who used to be in charge of intercepting prison contraband and he was shot 6 times in his home, back in march. fortunately he survived. but, investigators believe an inmate ordered the attack on him using one of the many illegal cell phones in prison, listen. >> we cannot trace them, we cannot record them and that enables the inmates to continue his activities, to harass the public. >> reporter: for several years south carolina corrections officials have been calling on congress and the fcc to relax restrictions on jamming which they say would solve the problem

altogether and state officials are beginning the news conference as we speak, back to you. martha: stunning when you think of the impact of cell phones on our lives and society, in many different ways, jonathan serrie, thank you very much. bill: 10 minutes past the hour and nine years after the day that changed the world, how much has truly changed since 9/11? incidents like the fort hood massacre reminding us we're at war with an enemy that has no definitive face and today the senate demands answers on the new homegrown terror threats, we'll find out about that. martha: and, 6 months now, after that -- the president's peb signed health care into law, the reform bill is starting to... we are seeing the changes the next 24 hours, how americans feel about it now that they are actually seeing it. and here's a question, we're getting a lot of response on this, many republicans would like to repeal health care and the reform bill, is it possible? could it happen, you are weighing in and we appreciate it and we'll get those up on air in

a while, go to our web site, at foxnews.com or send an e-mail or a tweet, which we call it, not a twitter. a tweet. we'll check it out. bill: all right. it wasn't greed, it might have been criminal, we'll find out today when these 8 people go before a judge. arrest of city leaders making some big money in the tiny town of bell, california. >> the complaint alleges they used tax dollars collected from the hard working citizens of bell. as their own piggy bank, which they then looted at will. [ female announcer ] your precious eyes. when allergies make them itch, don't wait for your pills to kick in. choose alaway, from the eye health experts at usch lomb. it works in minutes and up to 12 hours. bausch & lomb alaway. because it's not just your allergies, it's your eyes.

martha: brand new poll numbers out today that show that when it comes to the new health care law, americans are very divided. these are some pretty interesting numbers, folks. 40% now say they oppose the overhaul of health care which is going to start kicking in the next 24 hours, only 30% said they were supportive of it and favored the president and congress's health care reform plan, let's bring in our panel

of guests today, to bat it around, alan colmes, a radio host of the aptly named "alan colmes show", good have you. >> okay. martha: and, the former senior aide to the r.n.c., welcome, gentlemen, good to have you here. alan, it is interesting, what we are hearing is the only democrats who are out there campaigning on health care as an issue, actually voted no to it, and then you have the president coming out and starting sort avenue a big promotion campaign, telling people about the patients bill of rights. is he at odds with what the democrats are told they should do on the campaign trail. >> like the old will rogers line, i'm not a member of any party, i'm a democrat. and they ought to supports the president's agenda and the democrats, you know, ought to embrace the fact that as of today, and this is a messaging issue, that you have a whole list of, i mean, i have the list here, things that kick in, free immunizations for kids, preventive care like mammograms and cholesterol screening and you cannot deny coverage to kids

with preexisting conditions and this is something families need to know about and shouldn't have started six weeks before the election, educating people about it. people need to be up to speed on the very positive things the bill does. martha: i hear you. terry there are positives in there for people, and i guess some would say there is no such thing as a free lunch and it is not bringing down costs but there are goodies, front loaded in the bill. >> yes. they put the goodies in so it wouldn't seem so bad to people before election day this cycle and the fact of the matter is, there was broad bipartisan support for fixing health care, making more affordable, more portable and available to people, and, when you start throwing in the government regulations, and the new taxes, it adds up to a bunch of strict rules that are going to force premiums up, you know, one study i read this morning, 25% increase in premiums, over the next few years because of the health care reform. if you didn't like it today, just wait. you are going to really not like it tomorrow.

>> how much more premiums -- i don't know if those numbers are really true numbers. i don't think a lot of people know what will happen and the uncertainty is driving a lot of the fear about this and the insurance companies themselves are not doing what they said they would do, by some of them not even doing -- following the policies which is why we need aid public option or a -- one single payor plan so these insurance companies cannot ride roughshod over them. martha: maybe splitting the baby was not a good idea and if you had to go good way to get compromise on the bill, was that a mistake and, terry, when he says both sides of the aisle wanted to make changes and democrats were not having it, the majority. >> when you get the numbers, those against the bill, many are progressives and wanted a more progressive bill and not all conservatives so pose it. those people want a more progressive bill to give single payor or a public option. martha: and, the last minute we have, terry, i want to now how focused you think voters are on the midterms because there are

interesting polls out this morning, internet polls and we will not put them up but they got me thinking and it appears folks inside is the beltway feel it is wrap wrapped up and the republicans will take over the majority and people all over america are just starting to really pay attention in many respects. >> exactly right, and, as much as a third of the electorate, will not make up their minds until the late stages of the cycle. so republicans cannot be come place enter and there is a lot of energies and intensity for the republicans and for a changed message, and it is in the independent segments, though, independents or particularly turned off by obama and that is not likely to change. but, i am being cautious. i think the republicans have very hard work to do. this is going to be a battle royale before we know what the -- what the outcome is. martha: alan you start the next one when you come back, alan kohl's and terry holt, good to have you here. bill: any idea how fast the federal government is growing, over the past two years you will be stunned, because you asked. martha: sitting down to a quiet

night on the couch? when armed agents bust through the door, with automatic weapons. >> and, don't shoot, please don't shoot, you have the wrong family, this is the wrong house. >> machine guns pointed at us and they don't tell us who they are looking for and needless to say, i'm scared as hell! martha: oops! find out what happens, next. bill: they have a story to tell, right. martha: yes.

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martha: families now living in fear after the feds stormed their home in search of a guy who is already behind bars. heavily armed agents raiding a house in south florida. looking for the 29-year-old man, the homeowner's son. problem is, he's been in the slammer for nearly a year.

instead they scared the daylights out of innocent, unsuspecting people. >> i kept telling them, please don't shoot, you have the wrong family! this is the wrong house. >> we have machine guns pointed at us and they don't tell us what is going on and who they are looking for and needless to say, i'm scared as hell. >> they keep my granddaughter and boy outside the house on the ground, pointing the rifles, too. martha: several other residents in the area have complained about the statement exact situation. the family says no one has even offered to repair the damage to their home. bill: get that cleared up, huh? disappointing news on the economic front, the demand for home loans falling for the third straight week despite rates for fixed mortgages sliding to all-time lows, it has never been this low before, folks, if you want to buy, man, now is your time! high unemployment likely preventing many potential buyers from making the big home

purchase, and speaking of jobs, today, because you asked, tom m writes: can you tell me how much employment in the federal government expanded the last 2-4 years? public versus private? eric bolling, from the fox business network, host of "money rocks." here with us. how are you doing. >> i'm shaking my head, bill, nice to see you. i want to show you two graphics that will tell a story about employment over the past 24 months, on the screen, going back to 2008, focus on 2008, and focus on twain, and when we lost an average of 4 million jobs over the two years. we have added jobs, so far, in 2010, the little green line the far right, that is up and look at the two red markers, takes you deep in the ditch and now, federal government hiring over the past, say, four-and-a-half years. look where the chart goes, starting in 2008, up 78,000. 2009, up 108,000, 2010, we have

four months to go, still, up 108,000 in 2010, as well. the paradigm shifted, eric. >> well there is a reason for that, bill. "usa today," a couple weeks ago, we have cited this study, time and time again, "usa today," came out and said, you know, it is -- if you work for the federal government you make on average $123,000 a year, that salary, benefits and everything they can lump in. if you you work in the private sector for the exact same job, not apple and oranges, landscaper versus landscaper and cook versus cook, you make less than 60 grand and you know what else -- >> double. >> and don't get guaranteed pensions, a bump in your pension and you don't get job security the way you get when you work for the federal government and the different version of the chart you put up, since the recession, okay, 18 months into, the government hiring is up 10%, that is 200,000 jobs have been added, to the government, since

the recession, private sector, down 7%, that is 7.8 million jobs lost, going in opposite directions, of the -- government hire -- >> if you work in government and live in washington, d.c. you are good. >> golden. bill: thank you, eric. 8:00, eastern time." money rocks" i stole your line from you, i'm sorry, my friend, check out eric, great to have you. also go to "america's newsroom," our web page, foxnews.com, click on the "bya" box and shoot your question to eric, if you like. >> i'm there for you. bill: and follow me on twitter, @billhemmer, because us asked and that is because you asked. thanks, eric. what up, martha. martha: thank you, gentlemen. coming up the threat to the home land remains all too real. nine years after 9/11, look at the times square scare back in may, the christmas day would be bomber, or the fort hood

massacre, today the people whose job it is to keep us safe tell us how secure we should feel in this environment. bill: and the pay scandal, take down in the wake of a small city's outrage, 8 politicians accused of looting more than $5 million from the city coffers, they go before a judge today. what is being done to make sure it's not happening elsewhere, california's lieutenant governor is on that today and he will join us live. eric bolling has been all over the story, by the way, on "money rocks." >> enough is enough. >> disgusting. i mean, what he did, i mean, it is almost like a sickness. everyone has someone to go heart healthy for. who's your someone? campbell's healthy request can help. low cholesterol, zero grams trans fat, and a healthy level of sodium. it's amazing what soup can do. until...cascade complete pacs.

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martha: what is developing now here in "america's newsroom," president obama attending the u.n. general assembly today. set to speak at 4:00 p.m. eastern time, and, alaska republican lisa murkowski defending her decision to run as an independent write-in candidate admitting it defies the political norms, she lost the g.o.p. primary to up start tea party favorite, joe miller and trails him, currently in the polls. and, this story for you, k-rod set to face a judge today in the big apple. fransisco rodriguez arraigned on criminal contempt charges and now is accused of sending text messages to his girlfriend, despite a retraining order that was issued, after he allegedly assaulted her father, at the stadium. bill: breaking news now, out of

california, you'll see in a moment here. corruption on steroids, a work class suburb south of l.a., city leaders accused of using at least 5.5 million dollars, in taxpayer money, as their own personal bank account, that is the accusation and today the 8 officials in bell, california, including the mayor, head from jail to the courtroom for their arraignment. you might remember we told you the former city manager made $800,000 a year and here's the d.a. out of l.a. county, on what will happen today. >> this was calculated greed and theft, accomplished by deceit and secrecy. the bell city council for their part provided no checks, no balances. council members were busy enriching themselves by collecting money for meetings that never occurred. bill: by the way, bell, california, is far from bell aire, one in six live in poverty in that town and, the lieutenant

governor of california, who is running for re-election this year, sir, good morning to you and welcome back to our program. we talked a week ago. and you consider this an illegal tax was the phrase you use and there may be more to come, do you stand by that? are we about to find out more. >> bill, i said that these folks should be in jail. and, here we are, they are in jail as we speak, and going before a judge. and this is theft. you know, i go back to the residents of bell and i asked them, didn't you see your bills? what happened and, some come up to me and say, the bill came from the county of l.a. and we thought the county was charging us too much and small letters it said bell and folks were stealing from us, and i must say to you, bill, that i hope the surrounding areas are doing a better job, because they are next. rizzo was a smallest paid city manager in around the area, ten years ago, and now he's the highest paid, so everybody around better look at what we're doing in california. bill: you say they are next. what do you mean?

who is next. >> a couple of cities there, you have the city of berm man and the city of maywood and other cities, i don't have direct access to what is happening there, but the constituents are calling and saying, hey, how much is our city manager making, why are we paying more in services? our property tax isn't that high but they are making a lot of money, how are they doing and there's a bigger pot here, bill we have to continue the work on. and -- rizzo -- they hid everything, bill. bill: do you have evidence today that would suggest in bell, california, or any of the surrounding towns, there is more to be uncovered here? >> you know what? i don't have hard, hard evidence but my heart tells me the surrounding area has serious issues, and we're going to final out a lot about bell, bill, because these folks hid everything, you know, you can have a public hearing and a public meeting, but if you are hiding things it doesn't matter. these folks deceived everybody. bill: our colleagues at the fox business network including eric bolling, from "money rocks" have

been on the story since it broke in the beginning in "the l.a. times." why is it not happening today in california? were the public salaries are not posted on-line? why is that not the case? >> well, it does, i mean, you can do the -- state government does it but you have the small cities that go out to the public and they have charters and when they have a small charter, they are exempted from general law, california law and when they have the charters, bill, they do -- run their little operation and hide things and they deceive people and, they create all these meetings they are working and pay themselves more and no one knows and there has to be a change. bill: they set up their own rules based on their charter status and can't sacramento change that? >> absolutely. i think there's a lot of pieces of legislation that are coming out from the bill scandal i think a little too late, but all i can say is we will continue to look forward and look at the bills and make sure it doesn't happen again, post-everything you have 30-day ordinance and they need to be posted, put it on-line. bill: the reason why this story

has such resonance is because people across the country are wondering whether or not it is happening in their town. have you been diving into this, the american people you say what, if you want to find out answers? because we're not -- >> "the l.a. times," we may not know about this. there is no local newspaper in bell, california. >> i agree. i agree. "the l.a. times" did a heck of a job and are the ones that started digging in and we have an attorney general, we have a controller and they are into it now, but i must say, bill, that we have to make everything more public, it is a public trust and get it out to the people and you have to remember, too, those folks were not posting anything and we have to have laws with teeth and it must be posted and must be verified and we must follow up with check-ups and i'm afraid of what will happen in the future. bill: $2.9 million returned to taxpayers in bell, california, there might be more, stay tuned. next hour we expect to see all 8, a platoon of politicians before a judge, thanks for your time, lieutenant governor of california.

martha: all right, a big story today, folks, the bombshell new book is shaking up washington. from the man who blew the lid off the watergate scandal, bob dwoo woodward's book, "obama's wars" reveals a sharply divided obama administration when it comes to the war in afghanistan. k. t. macfarland, joins me now,i want your ideas of the book and you were around during the watergate scandal at the white house. and, these stories are hitting all of the news outlets around you. and, people are calling each other and asking names and you are working with them. >> yeah. the problem is, if you are in the white house you hate bob woodward. he has an ability, whether in the nixon administration, when i was in the white house, or today, to get people to talk to him and his reporting is very accurate and i think that is what is the most upsetting about the book, obama's war. the reporting is accurate and paints the picture of a chief executive who is not ready or

prepared to be a war time president and frankly a concluded, will get a lot of people killed. martha: wow. k. t., let's look at one of the quotes from the book, that has you riled up and other folk as well. and here's what it says. i have to say that mr. obama replied and this is in reference to the july 2011 deadline i would insert here, i cannot let it be a war without end. and i can't lose the whole democratic party. i believe this was a quote to senator lindsey graham. >> yes. martha: talk to me about what that tells you. >> okay, what that tells me is look, nobody wants it to be a war without end but obama, sat down, this is his war and he went to his military war council and he said these are the things i want to achieve, i want exit and i want to be sure, we get the -- destroy al qaeda and the t taliban in pakistan and they said we need more troops and more time and he said no, i'll give you more troops but i have the firm deadline and what obama

has done, frankly, is he sit up to fail, because, this is what he wants to achieve and this is the sources he's willing to devote to it. now, either he's got to be honest, about what he needs to achieve this goal, or, he has to reduce the goals. and, in either case he's not doing it and is setting it up, so it is almost designed to fail. and also, designed to come into conflict with his military leaders who are giving their best advice and they are not politicians, they are saying, hey, boss, this is what we need to achieve and what you want to achieve and he's not giving it to them. martha: there's another quote getting a the lot of attention, and we're short on time and i wanted to get it up and get your thoughts to it, anybody who went through september 11th, or was in close problems im ximity to : we can absorb a terrorist attack and we'll do everything we can to prevent it but even 9/11, we absorbed it and we are stronger. your thoughts? >> well, that is a pretty cynical analysis of the

situation. presidents of the u.s. has his primary responsibilities is to keep the u.s. safe. and citizens safe and if this is his attitude towards the whole thing, it flies with his attitude towards iran's nuclear weapons program. you know, when will he stand up and protect the american people? i think this book reveals a lot, i'm sorry to say, that it probably is what a lot of people thought it would be. martha: we'll be hearing i'm sure more reaction from the white house, and, their defense of a number of things, in this book and, the agreece sieveness they have gone after, a lot of the taliban in afghanistan, and, there will be more to be written, about that, k. t., thanks for your initial reaction to this. good to talk to you. bill: reactions, stunning to hear talked about how people could die. martha: she feels the attitude makes the country more vulnerable. and, you know a lot of people would say there's been a lot -- a lot of things in afghanistan under the bush way of doing things but this book points to a

lot of discrepancies and arguments going on. bill: it will be read in washington by many, many folks. martha: here as well. bill: all right. a major hearing under way on the hill. nine years since 9/11, are we any safer today? what is the real threat level? we'll check in on that. martha: here's a story that hit a lot of people in the country, a father on a school bus going after the kid who he believes are teasing his 13-year-old daughter and the man singing a different tune and we'll show you what he is saying now. >> no, i'm telling you this, man, you better watch out -- listen, i'm telling you to... stay away from my daughter [bleeped] and everybody on this [bleeped]... i'm telling you this, man. are you receiving a payout from a legal settlement

or annuity over 10 or even 20 years? call imperial structured settlements. the experts at imperial can convert your long-term payout into a lump sum of cash today. >> good morning, i'm jon scott along with jenna lee, on happening now the president sells his health care overhaul at a backyard barbecue and will

take questions from americans and crack down on al qaeda in the al qaeda hotbed of yemen, a possible terror threat from italy to tell you about as well. >> and horrific home invasion, murder spree, what can you do to keep your family safe, plus we'll talk to the man who wants to take nancy pelosi's seat in california. no easy task there. and a major discovery that some scientists are comparing to the tarpits? what did they find? we'll tell you, top of the hour. martha: thank you, jon and jenna, now eyeing what could be a shift in the way that we are fighting to protect our country from terrorism, accord to our counter terror chief al qaeda is at one of the weakest points ever. but the threat of homegrown terror like what we saw in the fort hood massacre and the botched times square bombing and christmas day botched bombing as well may be changing the face of this fight and it is all being talked about right now, in a senate hearing, neil livingston, terror analyst and ceo of

executive action, risk management firm, joins me now. neil, welcome, good to have you here. >> good morning. martha: in many ways i feel like we have heard about this for a long time. what changes based on the fact that the fbi director is now speaking out about the homegrown threat and the senators, you know, are having a lot of question about it? you have been covering this for the past many years and last year you know we had the highest level of terrorism activity in the u.s., including the fort hood shooting where 13 people died. and, the highest level since 9/11. so what the government is saying is we want to shift our focus from foreign terrorism now to domestic terrorism and that presents a whole different series of problems. martha: what tools do you need to fight domestic terrorism? i know a lot of the focus, went overseas and people were focused on al qaeda and the fbi was worried about general, regular

crimes at home and what do they needed to do to shift and be ready. >> the really tricky part is, that many of these people really don't have any connections to al qaeda. or any foreign terrorist group. what they are, are people who are simmering, they have other types of problems, and so on and they get on the internet and get recruited in effect by the kinds of jihadist web sites they access there. and, then they go out and do something bad and that is a very difficult thing to predict. also, it does suggest, however, they tend to be lower-level kinds of terrorist attacks. shootings, homemade improvised bombings, things like that. we don't think that is domestic group is going to be able to develop a chemical, biological or radiological weapon, so on the one hand, lower-level attacks here but on the other hand we cannot public them in many cases. >> it is frightening, because part of what i am hearing here, is there is not much we can do,

and, something could happen at any time and it is not because we were not doing our jobs? >> that's right. the issue is, we need, obviously, more people within the islamic community, to step forward, as they see something wrong, as they see people within their community, that may be bad actors, and we need to do a lot more domestic intelligence collection, and that is a very sensitive topic in the u.s. and, we don't -- have many more limitations, on how we collect intelligence here than abroad. so that is one of the things they need to address. martha: it seems like they are trying to prepare the american people, that this is a possibility and they struck out a couple of times, and, at fort hood, unfortunately, he was way too successful in that situation. so, it is a frightening development, thank you very much, neil livingston, always good to get your insights on these things. bill: all right, the architect of the president's economic recovery plan, is now out the door, not yet but, soon, larry

summers, calling it quits, so who fills the void, of one of the most important posts in america, and a sugar cone or regular cone with your pot? martha: what! bill: critics say, put sprinkles on that. others say, this is only the beginning. >> we've heard from the people who make the products, man, you will see it in everything, and you will have it in spaghetti and coffee creamer and whatever form you can. 1965, a lot of good thin came out that year

like medicare. this year, like always, we'll have our guaranteed benefits. and with the new healthcare law, more good things are coming: free check-ups, lower prescription costs, and better ways to protect us and medicare from fraud. see what else is new. i think you're gonna like it. ♪

bill: texas congressman blasting the obama administration for being soft on pot. republican congressman lamar smith says the white house is,

quote, encouraging the use of marijuana and claims the decision to not enforces federal drug laws against medical marijuana is the cause of a rise in pot-smoking and encouraging drug traffickers beyond their borders. smith says the administration should actively prohibited growing and selling pot, even though several states have passed laws approving its use for medicinal purposes and, if congressman smith is upset over that, he is not going to like this. pot-in fused ice cream, and, they are selling half pints across the state of california, and claudia cowan is here to tell us what is up with that, san francisco, claudia, good morning. >> reporter: good morning, bill, for people who do not want to smoke pot, cannabis-infused ice cream is a popular alternative and with the november ballot measure in california, seeking to legalize marijuana for adults, not everyone thinks that this sugary edible is such a sweet idea.

with flavors like banana foster and strawberry cheese cake, cannabis-infused ice cream could become widely available if proposition 19 passes in california. unlike smoking a bowl, eating a bowl provides a longer-lasting high. >> if you are in pain and your back will not let you get back to sleep, a hot shower and a little ice cream to get back to bed. >> patients don't taste the marijuana but they feel fiits effects, this has four doses of high grade cannabis and eating it would be the equivalent of smoking four rather large joints and those opposed to legalization see a slippery slope, not just ice cream but all kinds of cannabis cuisine. >> man it will be in everything, spaghetti, you'll have it in coffee creamer, you'll have it, whatever form you can and people with it sprinkle it on top of breakfast cereal. >> you will not find it on the shelf at safe way, you only get it from specialized sellers that have a permit to sell it only to

adults. and, place that's have dispensaries for medical use. >> reporter: regulating pot will help ensure labels are accurate and, there is still no fda approval because it is still illegal under federal law, and, bill, critics of prop 19 say they expect the department of justice to take legal action, if voters approve the measure. bill: claudia cowan in san francisco, thank you. martha? martha: all right, moving right along. her approving ratings are higher and the president's and now first lady michelle obama plans to hit the campaign trail, folks. we talk to someone who covered her for years, what can the first lady dodd for democratic lawmakers... bill: she said... martha: i said... who are hoping to keep their jobs. bill: and an enraged father, who yelled at the bullies on the bus, saying they abused his

daughter and, now, he has plenty of backers. >> you don't see when the bus comes late and everybody hangs out the bus and, my daughter is standing back, like she wants... let me tell you about a very important phone call i made.

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and guide to understanding medicare, to help you choose the plan that's right for you. as with all medicare supplement plans, you can keep your own doctor and hospital that accepts medicare, get help paying for what medicare doesn't... and save up to thousands of dollars. call this toll-free number now. martha: a story that's gotten a loft attention and knew humble apology from a father who admits he flipped out but he was doing it to protect his disabled daughter, james jones speaking out about the surveillance video that sparked a national debate, he says he lost his cool but he had to confront a group of boys who were bullying his 13-year-old daughter. >> i really wish i had done it in a different way, but at that time, i did it that way, because it broke my heart, she was standing there, crying, knowing she was not going to get on that bus. so i sincerely apologize for everyone. martha: enough said in my